“We currently only have limits on the amount of contracts you can have; position limits in the spot month when the futures are being sold," said Chilton. "There are no limits other than that. People are concerned and I am concerned about excessive concentrations of positions that could lead to manipulation of the metals market."

Chilton said there needs to be "a change to our manipulation standard; we have only been able to successfully prosecute one manipulation case in 35 years. Clearly, that needs to change.”

While he did not state what an appropriate position limit level would be for metals markets, Chilton said he liked the benchmark of 10 percent of open interest used in the energy proposal.

He said, “I have called Congress to amend our statute to give us the tools we need to deter, detect, and prosecute behavior that harms the pricing functionality of markets.”

However, proving manipulation in the metals market is exceedingly hard to do. Even harder, might be garnering support from his fellow commissioners to approve the move to curb speculation for metals contracts.

Speaking earlier to metal market investors in Washington, Chilton said, “"For the record, it's been my position that we should have included metals in the proposal that is currently out for comment on energy position limits. Frankly, there was not enough support for that at the time, and there may not even be today."

Chilton added, " Many say that there is clear ‘manipulation’ in metals and that we at the CFTC should merely ‘stop it.’ Well, in order for the agency to prove manipulation in court we have to demonstrate, among other things, that there was a specific intent to manipulate the market.”

The solution for Chilton is value regulation. “We need to have a law that provides us with the professional grade regulatory tools to do our job and put folks in jail who try to rig and contort these markets.”

“We have no regulation over OTC markets because they are dark markets. They can have an impact on regulated markets which is what prices are based on. Everything from gold to silver, to a gallon of gasoline, the regulated markets are what set those prices and when these OTC markets impact them, and we can’t see, we need to change that,” said Chilton.

“I hope that we learned something from the global economic calamity that we are all witnessing – we need an enhanced handle on what is going on in the markets. Secondly, we need progressional grade regulatory tools. Third, I would like us to implement position limits, we can do this without a legislative change; we just need the will to do it.”

The Commodity Futures Trading Commission is holding a public meeting Thursday to discuss futures and options trading in metal markets. Click here for list of participants. Noticeably absent from the list are the larger banks.

Stay informed with Kitco News live coverage from the CFTC meeting Thursday.